Investment style for a bond portfolio is best characterised by

Question

Quizplus · Accepted Answer

Credit quality and duration are the two key factors that determine the investment style for a bond portfolio. Credit quality refers to the likelihood that the bond issuer will default on its payments, while duration measures the sensitivity of the bond's price to changes in interest rates. These factors can help investors determine the appropriate level of risk and potential return for their bond portfolio. Beta and yield to maturity are not typically used to characterise bond investment styles, and interest rate risk is already accounted for in the duration measure.

Investment Style for a Bond Portfolio Is Best Characterised by